Marlene Leung and Jesse Tahirali, CTVNews.ca
Published Tuesday, February 20, 2018 9:50AM EST
Last year, Didi Taihuttu dramatically downsized his life, sold his huis and moved his family to a campsite so he could waterput their life savings into Bitcoin.
The Dutch father of three sold almost all of his family’s possessions, converting the bulk of the contant into the cryptocurrency. He even sold his children’s fucktoys to fund the venture, a stir he says he doesn’t at all regret.
It’s OK, he explained to CTVNews.ca, smiling te a Skype vraaggesprek. “They had a loterijlot of fucktoys.”
Inspired te part to live with less after the death of his father, the 39-year-old former IT entrepreneur moved his wifey and daughters into a petite cabin on a campsite near Venlo, Nederland.
Didi Taihuttu and his daughters. (Credit: Didi Taihuttu)
The bulk of the family’s money remains te Bitcoin, and they live off a petite amount of contant, including what they’ve made from selling the last of their private items.
The Taihuttus bought the cryptocurrency last summer when the price of one Bitcoin wasgoed toughly US$Trio,300. By Dec. 16, Bitcoin had leaped to an all-time high of almost US$20,000 — about six times the price they originally paid for it.
But Bitcoin is a rollercoaster. Just two weeks zometeen, on Dec. 31, the price had plummeted to just under US$13,000. On Feb. 20, when this article wasgoed published, one Bitcoin wasgoed selling for US$11,542. But even that may have switched by now.
After a wild rail ter 2018 that made Bitcoin a household name, what does 2018 have te store for the world’s most popular cryptocurrency?
",That’s the million-dollar question, isn’t it?” says Prof. Jean-Paul Lam, a professor of economics at the University of Waterloo.
Ter its conception, Bitcoin wasgoed designed to be a digital currency — a decentralized type of money that could be transferred around the world instantly without intermediaries, such spil banks or financial institutions. Unlike traditional currencies, Bitcoin is not backed or managed by any government.
Bitcoin wasgoed designed to have a finite supply of about 21 million, and harshly 17 million are already te circulation. Bitcoin is typically bought and traded ter puny fractions.
But Bitcoin has largely ceased to serve spil a currency, Lam says. This is due, ter part, to the extreme volatility te the price.
Spil Bitcoin rallied toward the end of 2018, a certain type of ",herding mentality", took overheen, says Lam, prompting ",speculative investors", to leap ter overheen a fear of missing out on a “fabulous terugwedstrijd.", This helped drive up the price.
“They don’t realize that thesis assets are utterly risky,", he says. ",You can make a loterijlot of money quickly, but you can lose a lotsbestemming too.”
Putting thesis investors aside, Lam says there’s a very real concentrate on the technology behind Bitcoin and other cryptocurrencies: blockchain.
The technology that powers Bitcoin and other cryptocurrencies is called blockchain. It is what makes it possible to securely buy, sell and spend cryptocurrencies without intermediaries.
Blockchain is a type of a collective digital ledger that records and verifies transactions te real time. It is secured by a network of computers, servers and devices that verify transactions by solving a ingewikkeld mathematical problem. This network is made up of people, called “miners,” who rival to solve the problem.
The miner, or pool of miners, that solves the problem very first is rewarded with a puny amount of cryptocurrency, creating an incentive for them to proceed to secure the system.
The transaction information is protected through cryptography and is stored te digital “blocks” across the network. Each block has a timestamp and is linked with other blocks te a chronological chain.
Te Bitcoin’s case, everyone can view the transaction information recorded te the blockchain and more informatie can be added, but nothing can be switched or deleted. And because the blockchain is on millions of computers and devices spread across the globe, it’s difficult for it to be infiltrated by hackers.
The end result is a chronological record of every transaction that can’t be altered, which reduces the risk of fraud, manhandle and manipulation.
Bitcoin and cryptocurrencies are early examples of how blockchain technology can be used. But many advocates believe it will go on to disrupt innumerable other industries, including finance, real estate and healthcare, to name a few.
Lam says blockchain technology could influence any area that relies on the recording and verification of work. “If you think of any sector like that, it basically engrosses the entire economy,” he says.
Canadian tech CEO Anthony Di Iorio also sees blockchain technology spil a potentially revolutionizing force.
Di Iorio is a co-founder of Ethereum, a verhoging designed on a custom-built blockchain. Ethereum also has a corresponding digital coin, Ether, which boomed alongside Bitcoin ter 2018.
Ethereum uses blockchain technology to run clever contracts, which are contracts that can be programmed with code. Thesis contracts are designed to flawlessly execute, once certain conditions are met.
Anthony Di Iorio, co-founder of Ethereum, a verhoging designed on a custom-built blockchain, speaks to CTVNews.ca
Di Iorio says thesis contracts could eventually eliminate the need for third-party intermediaries and middlemen, which can be costly and time-consuming.
He gives the example of a will, which normally has to go through a lotsbestemming of different mitts before it’s executed.
“It goes to the lawyers when you pass away, there’s a loterijlot of manual processes involved,” Di Iorio says. “This would be a system where spil soon spil the network finds out that you’ve passed away, it will automatically distribute your assets based on that coded contract.”
Blockchain technology has the potential to be a powerful spel changer because it builds trust te the gegevens, which is normally provided by intermediaries, Di Iorio says. ",Pretty much any sector that involves middlemen that play a role providing a trust layer inbetween individuals will be able to be substituted with technology.",
The money of the future?
There is a strong, vocal group within the cryptocurrency community that wholly believes Bitcoin (or another digital coin) will eventually substitute our current currency system.
They are active on popular online forums, where they discuss and debate swings ter cryptocurrency prices, fresh developments and rumours of government regulation.
Thesis people aren’t invested ter cryptocurrency to make quick money, they’re waiting for the day it is the money.
They envision a future when they buy and sell things with their Bitcoin spil lightly spil wij do with U.S. or Canadian dollars. And for some of thesis crypto-enthusiasts, this future is imminent.
Taihuttu, the man who’s staked his family’s life savings ter Bitcoin, estimates it to be about two years, give or take.
Ter a follow-up email to CTVNews.ca sent te mid-January, he says his family plans to hold their Bitcoin until at least 2020.
“We think crypto will become the fresh money by then,” he says. “If not, and if wij need money to live, wij will be cashing out a bit. But our purpose is to keep spil much spil possible te crypto.”
Di Iorio too is a believer, albeit he won’t venture to guess exactly when the day is coming. He’s not even certain it will be a single cryptocurrency or several, but he says a disruption is “definitely” on the horizon.
He compares the current monetary system predominated by many national currencies to an intranet that’s petite and local. Compare that, he reasons, to a system that’s like the internet: global and accessible.
Any country that attempts to restrict value spil their own currency within their own country will be “competing with global compels,” Di Iorio argues.
“They’ll always be fighting,” he says. “Well, there’s going to be a time when that fighting mentality is just not going to work.”
Yuri Takhteyev, chief technology officer at tech hard Rangle.io, says it’s indeed just too soon to predict the future of cryptocurrencies.
Takhteyev, who’s written about cryptocurrencies, says it may be some time before there’s a reasonable use case for the digital coins.
Yuri Takhteyev, chief technology officer at tech rigid Rangle.io
“With very disruptive technologies, one wouldn’t want to say it’s not going to solve any problems,” he says. “Often times with technology like this, it’s years before wij see its killer applications.”
He also warns that for investors, the crowded and ever-growing field of cryptocurrencies makes it hard to pick out the winners from the losers.
It’s something we’ve seen before ter the dot-com bubble of the late 90s, Takhteyev says. During this time, internet-based companies were raising massive amounts of contant and public rente, but ter the end only a few survived.
“If you were determining ter the ‘90s whether the internet is a big thing and CompuServe is the thing to invest te — well, the internet did turn out to be inescapable, but CompuServe didn’t,", he says.
What do crypto-enthusiasts think of the idea that thesis digital coins are te a bubble that may burst?
Te a postbode on his family’s webstek on the last day of 2018, Taihuttu wasgoed undeterred.
“Of course wij were a bit afraid when wij sold our company, house, cars and all other things. But to be fair it didn’t switch much, except media-wise, to our life,” he wrote.
“When you make a choice to go left at a certain point, afterwards there will again be the choice to go left or right. So every choice you make does not determine your entire future.”